BY MARCY SHORTUSE - If you attended the three-hour Gasparilla Island Bridge Authority meeting on Valentine’s Day, and many people did, it was a pretty typical bridge authority meeting. There were lots of words. Enough to make your head hurt. Lots of opinions, from board members and audience members alike. Lots of questions, too.
I understand there are a lot of questions. Sitting through a bridge meeting is a bit like walking into an advanced physics class with a basic knowledge of how to make Kool-Aid.
For example prior to GIBA financial meetings, I didn’t know what terms like “libor,” “standard gross-up provisions” and “revolving trust fund loans” were. It takes intense focus and concentration to follow the conversation, while at the same time figuring out the definition of the alien words through use of context. Sometimes, such as on Tuesday, it goes on for hours at a time, and if you are not a retired CEO/CFO it becomes, shall we say, tedious.
Many of the board members are incredibly savvy to the financial world and have served on Fortune 500 boards. I have not. Many of the people sitting in the audience have not, either.
So, what I thought I would do is take the most-asked questions I have heard on the street and in the meetings and address them once again.
Why wasn’t money set aside for this project since the bridge system was purchased? If you crank the calendar back to when board first started, they made a conscious decision to not change a thing unless they needed to. They were making a profit so they didn’t want to raise rates, but they were operating with reserves of only $100,000 to $200,000.
Any time a rate increase was even suggested to raise the emergency funds in their coffers, there was protest from the community. So, in a nutshell, the board didn’t want to raise the toll rates in order to benefit the people on the island.
The bridge was in some debt when it was purchased by GIBA in 1998, and the original board members didn’t want to do anything extravagant until that debt was paid down. Now it’s paid down, but it’s time to replace the bridges. Suddenly we’re looking at eating a giant cost ... and it’s a cost we have to pay off quickly.
Interest rates will not get lower than they are now. Neither will material and labor costs. It’s an ideal time to be backed into a corner, so to speak.
If the board had dispensed with the discount program, or raised tolls earlier to pay for replacement bridges, they might have millions in the bank, ready to go. But that would have also been at the expense of the residents, workers, and business owners on the island.
So, for quite a few years we need an additional $1.7 million, per year, to pay off the permanent loan for the bridges. The authority will procure that loan sometime in late 2013 or early 2014, so there is a little bit of time to juggle the final numbers. However, if an ad valorem tax is to be implemented, they want to get it on the November ballot this year.
Why is that? Why the hurry? Because the presidential election, particularly this one, will bring the voters to the polls. It is possible to have a special vote at another time, but the chances of many people coming to voice their opinion about just one topic, even during season, is “iffy” at best. The authority really wants to get a good, representative opinion from the people, and this will be their opportunity. David Hayes, who was elected as chairman of the bridge authority board this week, said he has spent about eight weeks talking to many homeowners and business owners on the island. He offered them several scenarios as far as ways to pay for the bridge replacement loan.
Many of them balked when it came to bridge toll increases of more than a dollar or two, and most of them didn’t like the idea of raising the taxes too high. According to Hayes, the premium “sweet spot” that most of them agreed on was a $6 toll and a quarter-mill tax increase.
It doesn’t sound too bad, as long as it will truly cover the additional loan expense. The final numbers aren’t in yet as to how much that loan will need to be. Also, keep in mind that if an ad valorem tax is voted down by islanders, tolls will definitely be going up higher than to $6. It could be more like $9 or $10.
Is there a chance that the tax and toll increase would ever be rescinded or lowered? In theory, yes. Right now, though, it’s too hard to tell when that might be.
If you have any questions at all about the bridge replacement process, sometimes it’s easier to speak one-on-one with Executive Director Jim Cooper or one of the authority board members. There is an awful lot of time taken up at these meetings by people asking questions that have been answered time, after time, after time.
Cooper has an open-door policy, and he really is in the office most days. Almost all of the board members are in the phone book. There is also a lot of information on the authority’s web site, giba.us.
I have had the rare privilege of attending just about every bridge authority meeting since 2005. I have followed this process of bridge replacement as closely as any laymen can, because I have to report to the public on it. My job is to weed out several hours of legalese and financial disclosure and discussion and determine the simplest way to put it, or whether it pertains to the story at all. It is hard. Very hard.
Many financial documents, as well as toll survey documents, are available through the GIBA office. All you have to do is call or email any of the addresses and phone numbers below, and you will find out many of the answers you seek.
It’s almost impossible to gain a complete knowledge of what is going on with this process without attending every single meeting. This is an important issue. Please consider speaking with your board members, or calling the GIBA office with questions before you attend a meeting. If you’re truly concerned about the bridge issues, get yourself up to speed.
Or, you can read the paper. We do our best to weed out extraneous information, and to simplify this process.
There were a lot of people in attendance for this week’s GIBA meeting at the Community Center, and that’s a great thing to see. It’s much easier to stay in the loop as to where your toll and tax dollars are going by attending the meetings, than it is by getting secondhand information from the cocktail party circuit.
Marcy Shortuse is the editor of the Boca Beacon newspaper.
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